KOSSAN RUBBER INDUSTRIES BHD
KLSE (MYR): KOSSAN (7153)
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Last Price
2.22
Today's Change
-0.01 (0.45%)
Day's Change
2.21 - 2.29
Trading Volume
7,719,700
Financial
T4Q
31-Mar-2021
2020
31-Mar-2021
2019
31-Mar-2021
2018
31-Mar-2021
2017
31-Mar-2021
Discussions
18 people like this. Showing 50 of 15,878 comments
Support is still very strong . Strong closing candle for harta. Flag pole and pendant pattern forming. High chance to continue the upward momentum in the near term. Simlar pattern seen for Kossan . Hopefully Kossan qtrly will satisfy the market with qtq increase in revenue and profit.
1 week ago
Follow Harta release QR same day? Harta weaker QR not much drop but Kossan better QR how about tomorrow?
1 week ago
Qtr Report is out.... sigh ... a bit disappointing but profitable. Revenue up 14%.
1 week ago
I usually look at comparison to previous quarter to see the immediate business situation. Comparing yoy quarter is more on seasonality.
From Report:
Comparison of Current Quarter (“1Q24”) with immediate Preceding Quarter (“4Q23”)
For 1Q24, the Group’s revenue was recorded at RM451.63 million as compared with 4Q23 of RM400.15
million, the increase mainly from Gloves and TRP divisions. Profit before taxation (PBT) was RM40.98 million
in 1Q24 compared with RM3.43 million in 4Q23 (inclusive of a one-off impairment loss of plant and machinery
amounted to RM35.38 million).
The Gloves division’s revenue increased by 15.19% to RM379.63 million in 1Q24 from RM329.58 million in
4Q23 due to higher quantity sold. PBT of RM26.57 million was recorded as compared with LBT of RM9.30
million in 4Q23 (inclusive of a one-off impairment loss of plant and machinery amounted to RM35.38 million).
The TRPs division’s revenue increased by 10.14% to RM48.95 million in 1Q24 as compared with RM44.44
million in 4Q23 due to higher delivery of products in 1Q24. PBT recorded at RM8.92 million in 1Q24 as
compared with RM9.99 million in 4Q23.
The Clean-Room division’s revenue was recorded at RM23.05 million in 1Q24 as compared with RM26.13
million in 4Q23 due to lower deliveries. PBT recorded at RM2.42 million in 1Q24 compared with RM2.84
million in 4Q23 was in tandem with the lower revenue.
1 week ago
When glove company is making huge loss, their cash in bank is very important.
Cash = Margin of Safety
Investor feel safe when they know this glove company has few billion in account and this money can ensure the company walk out from the crisis.
However, after the crisis past, the huge amount of cash in hand will become a burden.
It will drag down you ROE.. As all their cash can only generate very low income (3-4%), while investor is paying high PE for your stock (20-30 PE), so they need the company to generate high ROI. But because the industry has excess capacity and company cannot expand further, company must think a way on how to use the money to generate more income.
Is either you start to acquired other company, venture into new business, Invest in quoted securities, or you issue special dividend to investor.
Otherwise, your ROI will be continue to drag by your huge cash pile.
1 week ago
I rather have low ROI and ROE than have less cash. ROI ROE are just math. Cash is cash.
1 week ago
One of the example is INTCO, you look at their company announcement for the past 2 years, basically you can see that the company is actively investing in other business, subscribe to all kind of private equity products, because they have too much of cash, and they need the cash to generate higher return for them.
Top Glove has no such problem, as Top Glove spend too much money to buy back its share.
Supermax also no such problem, as they have use the money to purchase Airplane and build factory in US.
Harta have similar problem, but I believe Harta will continue to expand their NGC 2.0, 3.0.
So far only Kossan have this problem, perhaps maybe Kossan can start to expand upstream, such as acquired LUXCHEM, or expand downstream, acquired some distribution channel at Europe or US.
1 week ago
Bro.. in bursa no one cares about cash, revenue, inventory etc … it’s all about profit
1 week ago
Yup, agreed that Profit is the King. That why I try to highlight that Kossan huge cash pile has become a burden, as this cash pile unable to help Kossan generate more profit.
Kossan need more profit to sustain its current share price.
Currently its EPS for Q1 2024 only 1.2sen.
It need more profit (i.e. 100mil per quarter) to justify its current share price.
1 week ago
Remember in 2022. Kossan falls lowest to Rm0.98 while holding cash per share of Rm0.95. THat's 96.9% cash.
Meaning Rm0.03 constitutes the rest of the assets = plants, equipment, lands, business network, corporate structure etc. Dirt cheap.
And why prices can fall so low? Because Profit is King mentality. Traders look at price action and sell. To me that's gambling and totally ignore the fundamentals.
And why price can go up so high now? These upward trends:
> Demand gets higher. Revenue and profit get higher. (Proven)
> US-China rivalry. (Proven)
> Cost of production via automation and they have the cash to do it. Net profit higher (in progress)
I also forsee this regulative situation. Carbon credit. Kossan needs the cash to reduce their carbon footprint by investing in solar panels etc. Using natural gas instead of LPG. Government may require corporations especially public listed companies to buy carbon credit. I see Kossan has been doing that well.
I'm riding the long term trend. You can day trade but sometimes you can miss the boat. To each is own.
1 week ago
No one uses ROE for the glove sector. Banks yes. Must know where and when to apply such metrics.
How can cash be a burden? With that cash pile, Co valuation is cheap.
It has lots of options: can do M&A, can pay out special div, can expand, can spend on more automation/optimisation, can earn more interest income. Co has more potential with such a huge cash pile. Its called a warchest for a reason.
Business has pretty much recovered. With the upswing in earnings, the growth part of the equation returns. Oh but earnings not good enough. Really? 1Q24 is 33% of Maybank's estimates (that's a beat). Kossan just needs to continue beating estimates and sellside will continue upgrading.
1 week ago
With the rate on how well KOSSAN managed it's operating expenses vs Harta(ops expenses more than revenue due to decommissioning old to new plants), I won't be surprised KOSSAN market cap to surpass Harta by year end. Good luck, better reposition your glove portfolio
1 week ago
the current quarter financial result of Harta & Kossan show compression of profit still persist. Higher revenue with a same/ lower profit.
1 week ago
I'll tell you on Thursday. 😂😂😂
Epseps
@chipee well said. Just want to know Thurs mkt open price will up ?? Lol
1 week ago
Dow Jones
Dow Jones Industrial Average
39,671.04
-201.95
0.50%
Nasdaq
NASDAQ Composite
16,801.54
-31.08
0.18%
1 week ago
Kenanga remains a glove short seller 😅
https://klse.i3investor.com/web/pricetarget/research/71369
1 week ago
Dow Jones
Dow Jones Industrial Average
39,065.26
-605.78
1.52%
Nasdaq
NASDAQ Composite
16,736.03
-65.51
0.38%
1 week ago
The management expects its technical rubber products division — which makes custom products ranging from dock fenders to gaskets and from insulators to industrial rollers — to be supported by a gradual increase in global economic activity and infrastructure investment
1 week ago
Market sentiment bad ... see how long this last. Dow Jones and S&P will dictate that.
1 week ago
THE ONLY AI GLOVE FACTORY:
Supermax’s US factory nears completion
08 Dec 2023
Supermax Corp Bhd announced that its first glove manufacturing facility in the US is nearing completion, with the group having fulfilled and complied with various regulatory requirements, including permits, to operate the plant in Brazoria County, Texas.
“Supermax’s American and Malaysian teams have been working very hard to manage the setting-up of the US operations and we are pleased to announce that construction of our first manufacturing facility will be substantially completed before the end of December 2023. The next stage will involve the installation of various manufacturing equipment including AI, automation and robotics facilities,” said Supermax executive chairman Datuk Seri Stanley Thai in a statement that was issued following the group’s annual general meeting on Friday.
“A technical team from Supermax Malaysia will be deployed to the US facility in various stages for commissioning of the manufacturing facility,” Thai added.
According to the group, it is the first Malaysian company to set up a glove plant in the US, the biggest glove consuming market in the world.
The group, however, did not indicate when the plant, in which it planned an investment of US$350 million (RM1.6 billion), is expected to start production. It had originally targeted that to be in the fourth quarter of 2022, which was then pushed back to the second quarter of this year.
Meanwhile, Thai shared with shareholders at the AGM that the group is expected to continue to face challenges for the next five to six quarters, with improvements only expected in 2025.
Last month, Supermax reported a net loss of RM2.05 million for its first quarter ended Sept 30, 2023 (1QFY2024), compared to a net profit of RM5.71 million in 1QFY2023, as revenue shrunk to RM177.96 million from RM247.96 million amid weaker demand, while selling prices remained lower.
It is the group’s fourth straight loss-making quarter since 4QFY2023. Still, the group has been progressively narrowing its losses each quarter. It logged a net loss of RM108.07 million in 2QFY2023, RM39.91 million in 3QFY2023 and RM7.17 million in 4QFY2023.
In its results filing, Supermax attributed the losses it incurred to continued weak demand as buyers were still going through their heavily over-stocked positions post-pandemic, while it had to face a loss of revenue from a major market, the US, due to the Withhold Release Order imposed by the US Customs and Border Protection in October 2021, which was only lifted on Sept 18 this year.
Shares in Supermax settled unchanged at 90 sen on Friday, giving the group a market capitalisation of RM2.44 billion. The stock has climbed five sen or 5.88% since the start of this year.
Source: The Edge Malaysia
1 week ago
Supermx:
"The next stage will involve the installation of various manufacturing equipment including artificial intelligence (AI) automation and robotics facilities.
"A technical team from Supermax Malaysia will be deployed to the US facility in various stages for commissioning of the manufacturing facility.
1 week ago
Analyze Kossan Q1 result. Profit could had been higher if it wasn't bcoz of TAX month. They paid a big chunk in tax. Hopefully Q2 would be better.
5 days ago
Yeah ... true. But they still in profit unlike Harta, PBT is a loss. And Harta has more outstanding shares than Kossan. My argument has always been Kossan shld be more or same with Harta price. So either Kossan go up or Harta comes down to meet Kossan's price.
5 days ago
2 challenging factors still looms in gloves ... ASP and demand. And this directly affects PBT.
I see one factor is improving and that is DEMAND (Revenue increase for Kossan and Harta). China can't keep undercutting price. It affects their PBT too. China's lockdown is over. China lost their scale of production advantage by selling cheap. Their China demand has drastically dropped. Intco Medical made OPERATING losses in 2022 (-30,467) and 2023 (-100,958). They have to increase price in 2024. ASP will improve.
Biggest bomb on China for ASP is China-US rivalry. Now just rely on entry-port ban by US on China's gloves. IF Trump wins the tariff effect will be even greater than the 2026 tariff increase.
China use coal. Msia use nat gas. Both energy sources are going up in tandem. So not much difference there. Hell, if US wants to penalize China on ESG basis for using coal ... total ban on China's gloves. But we know that cannot happen la.
So people who said "Don’t blame tax. Just look at PBT" are just short term investors. I'm in for the long haul.
5 days ago
ABRDN bought when EPF was selling. I think their average price is below Rm1.50. So to take profit is normal.
ChandranG
ABRDN started to dispose the shares continuously ...
4 days ago
What happened to gloves in Msia will also happen in China. After China lockdown is over.
1) China gloves start making losses.
(Intco Medical made OPERATING losses in 2022 (-30,467) and 2023 (-100,958).)
2) China small gloves players got eliminated.
3) Big China gloves start rationalize (reduce) their production hence impairment losses.
4) They start selling at higher ASP.
As for the article from Edge https://theedgemalaysia.com/node/712277
"Hong Leong Investment Bank Research (HLIB Research), which is neutral on the sector, shares the sentiment, commenting that Chinese players will start to gradually increase their presence in European and Asian markets to reduce US orders."
Are they saying China gloves are not already in European and Asia market now and the years before covid ? Of course they are. In order to compete is only to reduce price and gain market share in Europe and Asia. China cannot afford to do that. They are already making losses. China has no choice but REDUCE PRODUCTION because CHINA LOCKDOWN IS OVER.
Problem with analysts on China is ... China production is BIG. Look at this data from World Bank 2019
Malaysia Export 401519 Gloves 2019 World 742,626,000 Kg
Thailand Export 401519 Gloves 2019 World 109,800,000 Kg
China Export 401519 Gloves 2019 World 73,646,800 Kg
China is only 9.9% of Malaysia production.
------
DATA on US import of gloves in 2019
United States Import 401519 Gloves 2019 World 410,269,000 Kg
United States Import 401519 Gloves 2019 Malaysia 258,422,000 Kg
United States Import 401519 Gloves 2019 Thailand 68,443,400 Kg
United States Import 401519 Gloves 2019 China 44,971,200 Kg
Malaysia covers 63% of US import. China only 10.9%.
------
COVID presented a different situation. US allow lower quality glove from China to satisfy the demand during COVID. But the OVERSUPPLY is coming mainly from Malaysia. So the ASP problem is OVERSUPPLY WORLDWIDE. But demand is slowly recovering (Kossan and Harta revenue is increasing) as oversupply depletes.
If there's concern about "flooding" the market with gloves, we should look at Topgloves instead. They are the biggest producer in the world. Not China. And TopGLove is losing money and their demand is far from their 2019 demand. They won't be flooding anytime soon.
My bet is on Kossan and Harta. Their export to US will be advantageous to them when tariff hit.
4 days ago
No concern on the glove fundamentals. Better to wait for a clear uptrend tmrow or fri
3 days ago
When the price is right, even owner of the company & ABRDN will also dispose their shares. Good luck long term investor.
3 days ago
2024-05-29
Insider
MR LIM KUANG WANG (a substantial shareholder) acquired 100,000 shares on 28-May-2024.
2024-05-29
Insider
MR LIM KUANG WANG (a substantial shareholder) acquired 250,000 shares on 27-May-2024.
3 days ago
Dow Jones
Dow Jones Industrial Average
38,534.16
-318.70
0.82%
Nasdaq
NASDAQ Composite
16,976.85
-43.02
0.25%
3 days ago
ARBDN still owns 137,392,700 shares. They sold 291,400 + 251,400 = 542,800..... 0.395% of the total shares.
It's the same with TS Lim Kuang Sia and other owners .... Like I said they are doing some profit taking like day traders. Which is ok. Value traders or FA can do the same too.
Just that TS Lim Kuang Sia is the CEO of the company. Show some confidence of the company la. He represents the company. Don't be a pariah CEO. THis kind of profit also want to take when he is already a billionaire. 🙄
Sometimes FA hold bcoz they are long term. Just bcoz they are long doesn't mean they didn't prone a bit to take profit. IT all depends on how many share you hold and risk management. Market is jittery bcoz US is already at all time high. IS it gonna crash or just 5% correction ... nobody knows.
Lukey_Greek
When the price is right, even owner of the company & ABRDN will also dispose their shares. Good luck long term investor. Long way to learn on understanding this wave fr FA perspective.
3 days ago
Last time b4 2008/2009 .... when US market down, other markets can be up. It's like investors leaving one market and move to another. NOW all markets are following US market. THeir consequence affect other markets too fearing another Financial Crisis.
3 days ago
YEah @5354_ I answered
Repost:
What happened to gloves in Msia will also happen in China. After China lockdown is over.
1) China gloves start making losses.
(Intco Medical made OPERATING losses in 2022 (-30,467) and 2023 (-100,958).)
2) China small gloves players got eliminated.
3) Big China gloves start rationalize (reduce) their production hence impairment losses.
4) They start selling at higher ASP.
As for the article from Edge https://theedgemalaysia.com/node/712277
"Hong Leong Investment Bank Research (HLIB Research), which is neutral on the sector, shares the sentiment, commenting that Chinese players will start to gradually increase their presence in European and Asian markets to reduce US orders."
Are they saying China gloves are not already in European and Asia market now and the years before covid ? Of course they are. In order to compete is only to reduce price and gain market share in Europe and Asia. China cannot afford to do that. They are already making losses. China has no choice but REDUCE PRODUCTION because CHINA LOCKDOWN IS OVER.
Problem with analysts on China is ... China production is BIG. Look at this data from World Bank 2019
Malaysia Export 401519 Gloves 2019 World 742,626,000 Kg
Thailand Export 401519 Gloves 2019 World 109,800,000 Kg
China Export 401519 Gloves 2019 World 73,646,800 Kg
China is only 9.9% of Malaysia production.
------
DATA on US import of gloves in 2019
United States Import 401519 Gloves 2019 World 410,269,000 Kg
United States Import 401519 Gloves 2019 Malaysia 258,422,000 Kg
United States Import 401519 Gloves 2019 Thailand 68,443,400 Kg
United States Import 401519 Gloves 2019 China 44,971,200 Kg
Malaysia covers 63% of US import. China only 10.9%.
------
COVID presented a different situation. US allow lower quality glove from China to satisfy the demand during COVID. But the OVERSUPPLY is coming mainly from Malaysia. So the ASP problem is OVERSUPPLY WORLDWIDE. But demand is slowly recovering (Kossan and Harta revenue is increasing) as oversupply depletes.
If there's concern about "flooding" the market with gloves, we should look at Topgloves instead. They are the biggest producer in the world. Not China. And TopGLove is losing money and their demand is far from their 2019 demand. They won't be flooding anytime soon.
My bet is on Kossan and Harta. Their export to US will be advantageous to them when tariff hit.
3 days ago
Trump got convicted. But he can still run for president.
Democrats just hammer in their final nail to their coffin.
https://www.politico.com/news/2024/05/30/can-trump-still-be-president-00160433
2 days ago
The US Cpe inflation is within expectation and Ecb most likely to cut rate in June. Tuesday will be a good time to bottom pick. Good luck
23 hours ago
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Chipee
Harta financial reports higher ASP and higher demand/revenue. Their diminished profit is due to cost to ramp up NGC Sepang operation. Basically big operation moving from Bestari Jaya to Sepang. Hopefully Kossan has no such operation. Just in situ improvement to operations. And no more impairment losses.
1 week ago